The Normal Layer 2 Index
The Normal Layer 2 Index is a crypto index composed of 10 of the most successful Layer 2 cryptocurrencies.
Overview
The Normal Layer 2 Index is a crypto index composed of 10 of the most successful Layer 2 cryptocurrencies. Layer 2 refers to secondary protocols built on top of existing blockchains that optimize their efficiency, speed, and transaction costs. Polygon (MATIC) is the largest asset in the Normal Layer 2 Index and is a Layer 2 solution for Ethereum - a popular Layer 1 blockchain.
Index Mission
Launched on January 26, 2024, the mission of the Normal Layer 2 Index is to capitalize on the current downfalls of Layer 1 blockchains like Bitcoin and Ethereum and the massive value created by Layer 2 blockchains. Traditional blockchains like Bitcoin and Ethereum have struggled with slow and expensive transactions for many years. This has inspired thousands of developers around the world to build solutions that help scale and optimize our favorite blockchains. This problem-solution thesis is what drives the Normal Layer 2 Index.
Assets
The Normal Layer 2 Index is composed of the following 10 assets:
- Polygon (MATIC)
- Stacks (STX)
- Arbitrum (ARB)
- Immutable X (IMX)
- Mantle (MNT)
- Optimism (OP)
- Starknet (STRK)
- Manta Network (MANTA)
- Metis (METIS)
- Loopring (LRC)
Our team has carefully selected these assets to appropriately encompass the mission of the index while maintaining integrity and security.
We review each Normal crypto index monthly to assess if assets should be added or removed. This process ensures our indexes accurately reflect the market to achieve their desired investment goal.
We recommend a minimum investment of $24 for the Normal Layer 2 Index to ensure all assets are purchased successfully due to exchange trade minimums.
Allocations
Asset allocations are updated daily, so please visit the Normal Layer 2 Index for the most up-to-date allocations.
For this index, we use a square root weighted market cap strategy to generate asset allocations. This ensures no single asset can dominate the index.
As of the writing of this article, April 2, 2024, the Normal Layer 2 Index allocations are:
- Polygon (18.28%)
- Stacks (13.6%)
- Arbitrum (12.15%)
- Immutable X (12.07%)
- Mantle (12%)
- Optimism (11.17%)
- Starknet (7.26%)
- Manta Network (5.03%)
- Metis (4.27%)
- Loopring (4.19%)
Returns
Over the past year, the Normal Layer 2 Index has returned 65.76%. Comparing this to the S&P 500’s annual return of 28.12% showcases the amazing opportunity crypto can provide for your portfolio.
It’s important to note that during this time the maximum unrealized loss of the Normal Layer 2 Index was around 48% in September 2023.
Monthly returns for the index currently sit at -6.77% and quarterly returns are 28.3%. The S&P 500 equivalents are 2.7% and 10.8% respectively.
Fees
All crypto indexes on Normal have a 0.50% investment fee. Our fee structure is slightly different than the traditional expense ratio you may be familiar with due to the unique value our indexes provide.
By investing in crypto using a Normal index, you can enter the market with 6x less fees than you’d otherwise pay using an exchange or on-ramp.
How to Invest
If this is your first time using Normal, setting up your account will take 5-10 minutes using our provided guides and walkthroughs.
Otherwise, investing in the Normal Layer 2 Index takes just a few seconds:
- Open the Normal Layer 2 Index
- Click “Invest” on the left-hand side
- Enter the amount you’d like to invest along with your desired exchange
- Review our fee and your order previews
- 🎉 Invest!
Investments for the Normal Layer 2 Index typically take around 5 seconds to execute. You can track your investment's progress in your Normal Dashboard.
Connect with us
Thank you for learning about the Normal Layer 2 Index. If you have any questions or need help with your account or investment, please feel free to connect with us via support@normalfinance.io, our Twitter, live chat (bottom-left blue button), or our Discord below.
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